Central Bank of India and U GRO Capital sign a c....................

Central Bank of India and U GRO Capital sign a co-lending agreement; aim to disburse MSME loans worth Rs. 1000 crore in next 12 months

 

·         To extend credit to all the segments of U GRO’s markets

 

U GRO Capital, an NSE & BSE listed, MSME lending fintech platform, today announced that it has signed a co-lending agreement with Central Bank of India. Under this partnership, the two entities aim to disburse upto Rs. 1000 crores to U GRO Capital‘s varied MSME segments under its programs like Pratham, Sanjeevani, Saathi, GRO MSME and Machinery financing, in next 12 months.

 

The Co-lending arrangement with Central Bank of India will work towards providing formal credit to underserved MSMEs at affordable rates across all product categories of U GRO Capital. For the same, the bank will leverage U GRO’s digital technology platform driven by a Data Tripod of GST, Banking and Bureau, in addition to the company’s deep sectoral understanding and multi-channel distribution reach.

 

The collaboration has been enabled by U GRO Capital’s GRO–Xstream platform, which through APIs integrates with Banks on one side and with multiple FinTechs, Payments Platforms, NBFCs, NeoBanks, Market places and other digital platforms on the other. GRO-Xstream empowers banks and other large financial institutions to deepen their distribution reach and service MSMEs across India through a wide array of transactions. U GRO Capital has formed marquee partnerships with upstream as well as downstream BFSI partners that are to be integrated on GRO-Xstream. At the initial stage, Banks would be co-lending through this platform with the loans originated by U GRO Capital’s distribution network, however in future other participants on the platform would also get access to capital through this platform.

 

Once fully operational, the GRO–Xstream platform would have the power to unleash and democratize MSME credit in India by leveraging Banks’ prowess on the liability side and U GRO Capital along with its origination partners as well as its underwriting engine on the assets side.

 

Speaking on the development of this partnership, Shri Rajeev Puri, Executive Director, Central Bank of India stated, “We believe this initiative will financially empower large section of MSME borrowers. We believe, Co–lending as a concept is picking up pace and would change the lending landscape of credit dissemination for MSMEs in India. This agreement is in line with the Central Bank of India’s objective to accelerate the credit to MSMEs in India and contribute towards the mission of Atmanirbhar Bharat by making credit available to MSMEs at an affordable cost.”

Speaking on this alliance, Mr. Shachindra Nath, Executive Chairman and Managing Director, U GRO Capital said, “We are delighted to sign the MoU for a co-lending arrangement with the Central Bank of India. We are witnessing an inflection point in MSME lending with the enhanced utility of the Data Tripod – i.e. GST, Banking and Bureau. For the first time UGRO Capital is signing a Co – Lending arrangement for all the programs which include Pratham, Sanjeevani, Saathi, GRO MSME and Machinery Finance. It is expected that U GRO would do approximately Rs. 1000 Crores disbursements through this tie up in next twelve months. Also, with this partnership, U GRO is now able to serve the entire spectrum of MSME borrowers across various interest rate buckets. Collaborations like these, will further catalyze the financial inclusion efforts for Indian MSMEs. This arrangement is a reaffirmation of our underwriting methodology and the belief that the bank bestows in our vision of solving the credit needs of the MSMEs, using sectoral expertise and technology. This partnership would not only benefit U GRO but eventually benefit all the other FinTechs and NBFCs which are integrated with our GRO – Xstream platform. We look forward to nurturing this relationship towards supporting more MSMEs to enable their revival and growth.”

 

 

 

 

RBI maintains ‘status quo’ to cushion the economy in

         Dr. Samantak Das, Chief Economist and Head of Research & REIS, JLL India.

RBI maintains ‘status quo’ to cushion the economy in the light of the pandemic resurgence; low mortgage rates to provide room for continued residential real estate growth

 

“The resurgence of the pandemic and resultant concerns of its impact on economy and businesses demanded a resilient approach. The Central bank has responded by taking an accommodative stance, kept the repo rates unchanged. The health of the economy has now become more contingent on the progress of vaccination and control of pandemic. In such a scenario, holding the repo rates at 4% is likely to cushion the impact on economy due to intermittent and regional lockdowns. The government’s decision to retain the inflation target of 4% with a tolerance band of +/- 2 percentage points for the coming five years provides continuity to the stance of the monetary policy committee.

Demand for residential real estate has revived as homebuyers took advantage of the lowest mortgage rates along with realistic pricing and various freebies and options rendered by developers. Residential sales in Q1 (Jan-March) 2021 recovered to more than 90% of the volumes witnessed during pre-Covid times across the top 7 cities. The sustained growth in sales presents clear signs of demand and buyer confidence coming back to the market. The recent surge in the spread of the pandemic is likely to impact the home buying sentiment for a few months. However, we believe that overall residential sales are likely to surpass the pre-Covid levels in the coming quarters.”

Budget expectations

Budget expectations

Attributed to Ramesh Nair, CEO & Country head (India), JLL

 The government made necessary and timely interventions through liquidity infusion, fiscal support and reform driven investments in the initial leg of relief measures. Further, the Central Bank and the Central government rolled out other critical measures including loan moratorium, relaxation of NPA classification norms, one-time restructuring of corporate and personal loans (including home loans), etc. These measures and concessions have definitely helped in enhancing consumer sentiment, thus boosting consumption, resulting in increased traction in the real estate sector. While we have seen a continuance of recovery in the fourth quarter which started in Q3 2020, the actual market transaction volumes continue to be lower compared to pre-Covid levels.

In this context, we believe that the following additional measures will aid in spurring consumption, investment; thus, resulting in a sustenance of a recovery led growth in the next few quarters.

 Accord ‘Industry status’ to the real estate sector

• Extension of benefit u/s 80EEA to avail additional INR 150,000 interest deduction on home loans to the following:
• Existing homebuyers who have already availed home loans
• First time homebuyers to include mid segment as well

• Separate provision for deduction of 'principal repayment' on home loans
• Restriction on setting off loss from house property against other heads of income at INR 2 lakh to be removed
• Reduction in holding period of REITs for long-term capital gains
• Allow 100% FDI in completed residential real estate projects through the automatic route
• Allowing input tax credit on calculation of GST payable in real estate